A cryptocurrency developer has received threats to his personal safety because his involvement in certain projects was construed to indicate darknet market involvement.
PyschicCat1 posted on Reddit that he had received threats to his family and his personal safety because of allegations of his involvement in the darknet market Trade Route, an accusation he emphatically denies:
The likely cause of PsychicCat1’s case of assumed involvement is his involvement as a contributor to Monero, a cryptocurrency solely focused on anonymous transactions, since 2015. Monero has been used in past darknet markets such as Oasis and AlphaBay.
“Always on privacy” can paint a target on the user
This incident underscores the power of perception when it comes to personal safety and reputation, as well as the potential vulnerability of a limited use coin. Monero is solidly focused on privacy, with all transactions encrypted and wallet balances obfuscated at the cost of ease of use and transaction fee economy. The result is a specialized use coin, whose competitive advantage lies in transacting in a situation where privacy is a top concern. This leads to common use for economic activity that may be considered illicit or illegal, or, more importantly, the perception that this is the case. Therefore, associations of involvement in, or even use of, exclusively privacy-focused coins can lead a user to be a target, as was the case of the above developer.
Dash employs PrivateSend functionality to anonymize transactions, however this functionality is purely optional. Further, the project is mainly focused on mass adoption as a digital cash, and therefore has many more prominent uses due to low fees and instantly-confirmed transactions through InstantSend. Finally, through partnerships with Coinfirm and Node40 which provides users easy and optional tools for accurately reporting their transactions to requisite tax authorities where applicable, Dash cannot realistically be used as sole grounds for suspicion by authorities or other parties of illicit activity. Other coins with improved privacy features, such as Zcash and PIVX, also keep their anonymous transaction functionality as purely optional, mitigating associative risks.
Crypto has come a long way since “drug coin” days, but the PR battle isn’t over
Cryptocurrency has made large advancements in public perception, however the struggle for mainstream adoption is far from over. In the early days, mostly due to the success of such projects as the Silk Road, Bitcoin received a reputation as a drug money, an idea that still persists despite its ability to be traced by modern blockchain analysis tools. While Dash makes a go at mainstream use, connotations of dubious use continue for digital currencies for the time being.